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Building a large trading bloc tends to produce substantial economic gains, while minimizing economic losses from overlapping FTAs. East Asia has tried to generate the impetus for promoting region-wide trading blocs, but most of those blocs have been overlapped and multilayered. This paper reviews the evolution of East Asian regionalism from the APEC FTA under the 1994 Bogor Goal to recent RCEP promoted in 2013. This paper underlines that the continued expansion of multilayered trading blocs in East Asia works as a serious obstacle to regional economic integration, rather than exploring the realization of a region-wide trading bloc.

Since the financial crisis, East Asian countries have worked on bilateral/regional Free Trade Agreements (FTAs). Currently, East Asian countries are working on over 30 FTAs. So far, the United States (U.S.) has exerted its considerable political and economic power in East Asia, but its political and diplomatic position is increasingly shaky for many reasons-emergence of China’s economic and military strength, growing regionalism in East Asia, weakening influence of the Asia Pacific Economic Conference (APEC) forum, and growing anti-American sentiment after the anti-terrorism war. The U.S. will be even more concerned about the development of FTAs in East Asia, since the country will suffer economic and non-economic losses when the East Asian regionalism is developed. This article evaluates a U.S.-Korea FTA in terms of U.S. involvement in East Asian regionalism, and tries to provide an economic assessment of the FTA. This article points out that the U.S. should take advantage of the U.S.-Korea FTA to secure its interests in East Asia and to avoid exclusion from East Asian regional economic integration.

This paper aims to seek to find answers to three questions. First, is there any possibility of long-term cointegration between East and Southeast Asian equity markets? If so, how many cointegrating equations are there? Second, what are the short-term causal relationships between equity markets in East and Southeast Asia? Third, what is the East Asia’s most influential equity market toward their Southeast counterparts, and vice versa?

This study uses Johansen's (1988) cointegration method to test long-run relationships among East and Southeast Asian equity markets. With regards to short-run causal relationships, this study uses Granger-causality test as well as the forecast variance decomposition method.

Johansen test proves that there is cointegration between East and Southeast Asian equity markets, but the integration process is not complete. Cointegrating vector also provides evidence that member countries of ASEAN+3 respond differently to external shocks. With regards to short-run causal direction, this study finds that Japan Granger-causes all equity markets in Southeast Asia, while Singapore and Vietnam Granger-cause all equity markets in East Asia. These results imply that Japan is the market with most linkages in Southeast Asia, while Singapore and Vietnam are the markets with most linkages to East Asia. Furthermore, forecast variance decomposition reveals that Japan is the East Asia’s most influential equity markets, while Singapore is the most influential equity market in Southeast Asia. This study suggests that policymakers in East and Southeast Asian countries to synchronize the capital market standards and regulations as well as to reduce the barriers for capital mobility to spur the regional equity market integration.

Increasing integration of East and Southeast Asian capital markets forces policymakers in ASEAN+3 countries to synchronize monetary policies, as it has been found that regionally integrated capital markets reduce the degree of independent monetary policy (Logue et al., 1976). It is therefore important for policymakers in East and Southeast Asian countries to assess the possibility of stock market integration within this region to anticipate the future risks associated with economic integration as well as to build collective regional institutions (Wang, 2004). Click and Plummer (2005) also argued that integrated stock markets is more efficient than nationally segmented equity markets, and the efficiency of Asian capital markets has been questioned in particular after the 1997 Asian financial crises. Yet, the empirical evidence on the extent of financial integration among ASEAN+3 member countries has been limited and inconclusive. This study is therefore an attempt to investigate the recent development of ASEAN+3 equity markets integration.

This study focuses its attention on the existence and the extent of financial integration in East and Southeast Asia region, and it provides evidence that equity market integration in ASEAN+3 is far from complete, and for that reason, there is a need for policymakers in ASEAN+3 member countries to synchronize their standards and regulations. Furthermore, the policymakers in East and Southeast Asia can gain benefit from this study, as it provides the evidence that ASEAN+3 member countries respond differently to policy shocks, which may hinder the development of regional financial integration as well as the policy effectiveness of region-wide authority in ASEAN+3.

This research is different from previous studies, as it puts the regional financial integration within the context of ASEAN+3 frameworks. Unlike previous research that considers East and Southeast Asian countries as an individual entity, this research considers East and Southeast Asia into two different blocks, following Tourk (2004) who documented that negotiation process for ASEAN+3 financial integration is conducted in sub-regional level (ASEAN vs East Asia), rather than national level (country per country basis). Second, this study covers the period after the 1997 Asian financial crisis. As suggested in Wang (2014), that the degree of stock market integration tends to change around the periods marked by financial crises, the updated study on Asian financial integration in the aftermath of 1997 financial crises is important to document the development of regional financial integration.

This paper examined the future prospects of China’s economic development and its impact on the East Asian Economy and the economic integration of the region. The key issue to China’s economic growth is the contradiction between the socialist political system and a market-based economy. The overall assessment is that China will be able to manage the transformation of the nation into a steadily growing market economy.

We also found that China is the key country forming a triangular trading block which has implemented the international division of labor in the North-East Asian region. China’s rapid export growth and increased market share in the world economy is not a threat but a new opportunity for the East Asian countries. The rise of China will certainly be accompanied by an expansion of a consumer market, which will also broaden business opportunities for East Asian.

Despite the interdependence between East Asian countries, a regional trading bloc embracing East Asia has not been created yet. The future prospects for realizing the vision of a regional free trade agreement in East Asia in the foreseeable future is not bright, either.

This paper aims to provide new perspectives on the integration of East Asian stock markets and the dynamic volatility transmission to the Bitcoin market utilising daily data from 2014 to 2020.

The authors undertake comprehensive analyses of the dependency dynamics, systemic risk and volatility spillover between major East Asian stock and Bitcoin markets. The authors employ a vine-copula-CoVaR framework and a VAR-BEKK-GARCH method with a Wald test.

(a) With exception of KS11 and N225; HSI and SSE; HSI and KS11, which have moderate dependence, dependencies among other markets are low. In terms of tail risk, the upper tail risk is more significant in capturing strong common variation. (b) Two-way and asymmetric risk spillover effects exist in all markets. The Hong Kong and Japanese stock markets have significant risk spillovers to other markets, and quite notably, the Chinese stock market is the largest recipient of systemic risk. However, the authors observe a more significant risk spillover from the Chinese stock market to the Bitcoin market. (c) The VAR-BEKK-GARCH results confirm that the Korean market is a significant emitter of volatility spillovers. The Bitcoin market does provide diversification benefits. Interestingly, the Chinese stock market has an intriguing relationship with Bitcoin. (d) An increase in spillovers in East Asia boosts spillovers to Bitcoin, but there is no intuitive effect of Bitcoin spillovers on East Asian spillovers.

For the first time, the authors examine the dynamic linkage between Bitcoin and the major East Asian stock markets.

This paper examines the influence Japan’s participation in the TPP negotiations will have on the course of subsequent East Asian economic integration, and mainly from the perspective of the three Northeast Asian countries of Japan, China and the ROK. In the first half, as a premise thereto, we first bring together the development of the FTA policies of China, the ROK and Japan, and then the connections with East Asian economic integration.

The leaders of the Association of the Southeast Asian Nations (ASEAN) announced to negotiate a Regional Comprehensive Economic Partnership (RECP) in November 2012, which is comprised of 10 ASEAN Member States (Thailand, Indonesia, Philippines, Malaysia, Singapore, Brunei, Vietnam, Cambodia, Laos, and Myanmar) and its six FTA partner countries (China, Japan, South Korea, Australia, New Zealand, and India). Embedded in the ASEAN Charter and implemented in all existing ASEAN + 1 FTAs, the ASEAN Centrality has been a corner stone principle in ASEAN-centric economic initiatives. Emerging discord in the region, complicated security climate and the rise of China, among others, have put the ASEAN Centrality under challenge. The development of the RCEP provides a timely case to assess ASEAN’s leadership role in creating the world’s most populous Free Trade Area. The RCEP may enhance ASEAN’s central role, but ASEAN needs to address challenges facing the regional integration now and beyond 2015. On the country/economy level, the chapter reviews some ASEAN Member States and their FTA Partners how they practice their ASEAN policy and seek leadership role in ASEAN. The three major players in ASEAN-Indonesia, Thailand, and Malaysia have reiterated the importance of the ASEAN Centrality in their foreign policy in the past, but debates emerge whether, such as in Indonesia, ASEAN Centrality best suits the national interests. The chapter also explores how the major powers, including China and the United States, respond to and collaborate with the group of smaller developing country players.

The economic success of East Asia was due to an export-led growth strategy, which was heavily dependent on the global trading system underpinned by the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO). In recent years, however; East Asian countries have shifted their trade policy focus to regional agreements and made Free Trade Agreements (FTAs) among themselves arid with other regions. Government organization has been restructured to increase FTA activities. Generally, the current literature predicts that FTA activities of East Asia would help to increase the welfare of the region. In this paper; we offer a critical assessment of East Asia FTAs. We note that East Asia FTAs provide incomplete coverage of sectors and are likely to lead to an inefficient resource allocation. FTA movements are not matched with actual trade flows. The benefits of East Asia FTAs are fairly limited and potential benefits, if any, would not likely be materialized in the near future. Our overall assessment is that the recent policy shift in East Asian countries from multilateral trade orientation or unilateral action to regionalism or a parallel multilateral and regional trade approach will not produce much gain. The governments should increase their efforts at economic reform and reduce barriers to trade and investment, rather than to allocate more resource and manpower to FTA activities.

The aim of this paper was to focus on China’s economic integration with Asia region and the world. It also attempts to find the long-run relation with short-run dynamics of China’s trade in Asia and the world.

The augmented Dickey–Fuller and Phillips–Perron methods are applied to test the time-series properties of the variables. Co-integration technique is used to detect the economic integration of China’s export to the USA and its import from Asian nations using monthly aggregate data from December 2005 to July 2010.

This study observed that empirically China’s export to the USA depends on exchange rate and China’s import from Asia depends on China’s export to the USA. China has double role in international trade – China acts as an attractor of all inputs from Asia, and China exports the final products in international market. This study also reveals that the speed of China’s import from Asia is faster than that of China’s export to the USA.

This study has some limitation in terms of data availability, and choice of methodology like the Gravity model

The results imply that China’s trade should be treated as an engine of growth in the Asian developing countries and the trade promotion policies should be encouraged. The emerging China will create other opportunities through trade integration with Asia and the world.

These empirical findings will help policy-makers formulate their policy and design the mechanism for application as per their targets.

China is economically integrated with the region and the world. The paper contributes to measure the speed of China’s export and import in short run within Asia and the world. These empirical findings will help policy-makers to formulate their policy and design the mechanism for application as per their targets.

This paper applies the decomposition method proposed by Wang et al. (2013), together with the multi-national input-output tables from World Input-Output Database (WIOD) to estimate the value-chain transition in East Asian production network. Specifically, we calculate and examine the domestic value-added absorbed abroad, foreign value-added embodied in country’s gross exports, and vertical specialization measures to explore the relative positions of major East Asian countries in the global production chain over the period of 1995-2011. The analyses are at country-aggregate, country-sector, bilateral-aggregate and bilateral-sector levels. Based on our results, we answer the important question of whether Taiwan and South Korea have used China’s production chains as an intermediary to re-export their products to other countries in the world. Furthermore, we answer the question that over the 1995-2011 periods, have Taiwan and South Korea exploited cheap labor from China to add value to their products before re-exported them to the rest of the world?